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>> I am here in a Rio di Janeiro at IATA's

annual meeting with Peter Carter. He is

the president of Delta Airlines. Thank

you so much for being with us.

>> Well, thank you for having me. Good

afternoon.

>> Good afternoon. I want to start with the

question that is on a lot of people's

minds about consumer demand and how it's

holding in given some of the increases

in prices, given some of the questions

around stress. How resilient have

consumers been?

>> We are seeing very strong demand, Lisa.

Um, in every region, every region in the

world, which has been very very uh great

to see the consumer is strong. Um, the

economy is doing well. It's one of the

things that we pay very close attention

to and whether it's the US economy,

certain economies in Europe are doing

are doing better. um we see that in our

consumer

>> certain economies in Europe that

actually flies against what some people

seem to think where you've seen sort of

some of the numbers fly down. Where are

you seeing actually growth in Europe?

>> Well, the UK is an example. They're

doing a little better than they have in

the past for sure. Um and and I also

think that that the EU in light of their

investment in defense um we're also

seeing some um some some signs there.

So,

>> how much have you been able to pass

along the increases in price from fuel

to consumers? I mean, has it been pretty

easy? Have you been surprised at how

little push back you've gotten?

>> Our consumer is resilient. Um, you know,

we really focus on the premium customer

and, you know, roughly 40 to 50% of the

increase in fuel cost we've been able to

recapture through pricing, which really

becomes about 10 to 15% on the price of

a ticket. So, flying is still

affordable. And again, we've need we

we've seen strong demand despite um the

need to recover some of our costs. We

also have a refinery which has been a

terrific hedge for for Delta through

this because we pay less for jet fuel um

than any airline in the world.

>> Has there been any push back at all to

higher prices?

>> Um we we really haven't. I think in part

because we haven't seen it. I I think in

part, Lisa, because when you look at

inflation um since co it's roughly been

about 25%, but when you look at

inflation around the price of an

airfare, it hasn't been anywhere near

25%. Even with this increase to recover

fuel. So, it's still very affordable and

especially for the premium passengers,

the the premium leisure traveler, the um

the corporate customer that we really

focus on. Um, so you know, this is going

to be our busiest summer in the

transatlantic. We are doubling down on

our global network and global expansion.

We already have the world's I think most

connected network, but we're continuing

to invest. We just launched our Hong

Kong route uh yesterday with I guess

today technically with our inaugural

flight. Um, so there's so many exciting

things happening and again we follow

demand. you know, we we launched seven

new flights in Europe because our

customers are saying they want to go to

places like Porto and Malta and

Sardinia. Um, so we're taking advantage

of that.

>> How much are there certain places that

you've identified that you want to

create routes to that are harder to

break into that might be really popular,

but there are obstacles that have kind

of emerged? Um well I I think the best

example of that right now is probably

India because we cannot fly over Russian

airspace but as we all know India it's

the fastest growing economy the biggest

population the largest democracy in the

world um and someday we will serve India

but it's very difficult to serve India

profitably without flying over Russian

airspace. I know that later this year

you were planning to launch a flight to

Riyad, direct to Riad. Uh, is that still

planned for later this year?

>> It is planned for October 23rd. We're

very excited. We met with Riad earlier

today. They're our partner in that

region. Um, we think that is such a a

strong growth market. It's a country

that's gone from the Middle Ages to the

modern age in about, you know, a handful

of years. 40 million people live in

Saudi Arabia. It's a large geographic

area. Um they've got a lot of business

travel. Obviously, oil and gas is huge

there. Um so we're we're going to start

that flight. We we know obviously with

what's happening in the Middle East that

uh folks in America may not see that

that necessarily is the place they want

to go right away, but as these new

routes develop, it takes time and we

want to be there for when the day comes

when they're ready to travel to Saudi

Arabia.

>> You believe that there will be sort of a

rejuvenation of some of the business

demand and the business activity in the

region that will be at the same level uh

as before the war. Not only will there

be rejuvenation at the same level, we

think there'll be great growth. It

remember um one of the things that they

do really well in Saudi Arabia is they

build things and because of the war and

what's happened in that region, we think

there'll be tons of business flowing in

to help rebuild uh what what has been

damaged uh during the the the conflict.

Um, and and then of course when you look

at what Saudi Arabia is doing, when I

was there last year, looked out of my

hotel room, I think I saw 50 cranes.

It's incredible what they're doing in

that country. Uh, and we want to be a

part of that.

>> When you look uh around the world and

you're looking at expanding your roots,

how much are you looking at

partnerships? Do you ever consider

consolidation as well? Just an outright

merger, an acquisition? Uh no, we're not

in the consolidation business, but but

we have grown uh through partnerships.

We we one of our real core competencies,

one of the things we do really well is

we form JVS with airlines around the

world. We have the best partners with

the best brands and the best hubs,

complimentary networks that we can

connect our customers to which allows

somebody to get on a flight anywhere in

the US and fly almost anywhere in the

world um that they would want to go. Um

Korean is a great example. Korean is

about to close um their merger with

Aiana. I think December 17th they will

have a single certificate. Um, we

already have such a great joint venture

with them across the Trans-Pacific.

We're going to continue to grow that

because with that merger, there's going

to be that much more connectivity

throughout Asia. Uh, very excited for

that. And Inchan, I don't know if you've

been there, but it is um, I think among,

if not the most efficient connecting hub

in the world. It's an amazing

experience. How do you sort of plan

forward when there are these

geopolitical concerns that keep coming

to the four? For example, business

travel from the US to China has fallen

off a cliff. A lot of tourist travel

also. How do you plan for growth given

the uncertainties between these two

countries?

>> I think we have the long view, Lisa. I

think we remain focused and disciplined

with respect to our strategy. Um, and we

know that there will always be

geopolitical noise and we are very, I

think, disciplined about trying to keep

the noise out and continue to build

forward, continue to make sure that we

know that demand will come back to China

someday, that some of the restrictions

that are in place will be lifted and we

have the relationships there. We we have

a great partnership uh with China

Eastern. we, you know, saw them here as

well. Um, so we're ready when that

economy is more open to US business and

US business is more open to that

economy. This geopolitical I'll call it

uh tension or you said noise. I think it

will pass.

>> Well, it's it's noise but not really

noise. I mean, it's also it's real. I

mean, it's also sort of like the Middle

East. It's noise but it's not noise at

all. It's a headwind for sure. And I

just wonder, you know, everyone who I

talk to here is very worried about oil

prices where they are. Do you have

contingency plans should things go up

significantly higher? I mean, what's

your sort of scenario analysis?

>> So, we are Delta is is built for for

durable, sustainable growth. Um, and

part of that is we have the ability to

manage through um oil costs. It it it's

we're very nimble. Um, we have various

tools available. We're very much focused

and disciplined on using those tools.

Um, and in many respects when you have a

strong balance sheet as we do and we

have a refinery, we can do things like

um trim capacity uh off peak flying. We

can focus on flying as efficiently as

possible, right? That saves fuel of

course. Um, we do all of the things we

can do and we we're still expecting to

make around a billion dollars this

quarter. So, um I think this is actually

um an an opportunity for us to show how

durable our business model is. Um and

it's a proof point.

>> I just want to finish up with premium.

It's been leading the charge for quite a

while. I know that Delta's really leaned

into Delta 1, the Delta 1 lounges. How

far can that go? The idea, the demand

for premium products. So Lisa, we are

finding that our consumer has an

insatiable appetite for premium

experiences and everything that we have

introduced seems to just be truly

inhaled by the by the consumer. And so

so we haven't seen and I'll give you a

great example. We opened a Delta 1

lounge in LAX just a couple years ago

and it's been wildly successful and now

we're building a second Delta 1 lounge

in LA because it is again one of these

things where we underestimated how

successful it would be. So, um I I think

consumers are really excited about

spending money on premium experiences

and I feel very fortunate that Delta and

our people can provide those experiences

to them.

>> I'm waiting for the super duper loyalty

Delta 1 Extreme Lounge. Is that coming

next?

>> Who knows?

>> Peter, wonderful to speak with you,

Peter Carter, the president of Delta.

Thank you so much.

>> Thank you, Lisa. really appreciate.